ALBANY – State lawmakers and government watchdogs yesterday denounced Assembly Speaker Sheldon Silver for accepting discounted rental cars from Avis as the company was lobbying the Legislature to change industry laws.

“This was clearly giving something to get something in return; this was an effort to influence legislation,” said New York Public Interest Research Group Legislative Director Blair Horner.

“There should be a bright-line ‘no gifts rule’ at the Legislature, so that this kind of thing doesn’t happen,” Horner added.

The Post disclosed yesterday that a senior Avis executive secretly testified to the state Lobbying Commission in 2002 that the car-rental giant gave Silver (D-Manhattan) and other prominent lawmakers – including Assemblyman Herman “Denny” Farrell, the state and Manhattan Democratic chairman – special 30 percent discounts and waived the price of vehicle upgrades.

The company gave the favors while it was seeking legislation to shift responsibility for auto-collision damage insurance from itself to renters.

“This was an ethical lapse,” said Assemblyman Thomas Kirwan (R-Newburgh.) Other lawmakers said the action by Silver and the others had, in the words of one, “brought embarrassment on the Legislature.”

Silver repeatedly refused to discuss details of the discounts, but said The Post’s report contained “no allegations of violations of the ethics law by any Assembly member.”

But The Post disclosed that the discounts received by Silver were worth at least $340, and the ethics law bans lawmakers from receiving gifts worth more than $75.